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Text of Prime Minister’s inaugural address at Delhi Economics Conclave

Dated:- 6-11-2015 - My colleagues in government, Friends and Distinguished Guests from India and abroad, I am happy, to be here today, to address the Sixth Delhi Economics Conclave. This is a good platform for bringing together economists, policy-makers, and thought-leaders, from India and abroad. I compliment the Ministry of Finance for organising it. Your topic of discussion is JAM, that is, Jan Dhan Yojana, Aadhaar and Mobile. This JAM vision, will serve as the bedrock of many initiatives to .....

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tes are down. • The fiscal deficit is down and the rupee is stable. Obviously, this did not happen by accident. And the world economy is not exactly doing well. This success, is the result of a series of well thought out policies. Many of the purely macro economic reforms we have undertaken, are probably well known to this audience. We have embarked on a course of fiscal consolidation. We have entered for the first time into a monetary framework agreement, with the Reserve Bank to curb infl .....

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- TALK. We have actually acted. Secondly, we have reduced wasteful expenditure through innovative methods like the use of technology. Some of the methods, are part of your agenda, such as using Aadhaar to target subsidies to the deserving. These are reforms that you are probably aware of. But our reforms are far broader, and far deeper, than is generally recognised. Before I elaborate on this, I would like to raise two issues. The first is, REFORM FOR WHAT? What is the aim of reform? Is it just .....

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Vikas. In short, reform is not an end in itself. Reform for me, is just a way station on the long journey to the destination. The destination is transformation of India. Therefore, REFORM TO TRANSFORM. And reforming to transform, is a marathon, not a sprint. The reforms we have undertaken, are of many types. For simplicity, I will classify them as financial, structural and institutional. It will not be possible for me to cover all of them here. But I will certainly mention some of the most impor .....

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r this reason that development experts have been advocating financial inclusion. What we have done in the last 17 months is to bring one hundred and ninety million people into the banking system. This is more than the population of most of the countries in the world. Now these millions are part of our banking system, and words like interest rate have a meaning for them. Not only have these people been brought into the system but they have shown that there is great strength at the bottom of the p .....

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mobile ATMs . A mobile ATM is one where cash can be drawn and simple banking tasks done through a hand held device. Thanks to Jan Dhan Yojana and the RuPay debit card, we have also introduced healthy competition in the debit-credit card space. This has traditionally been dominated by a few international players. Even one year ago, there were hardly any indigenous card brands in the market. Today, 36 % of debit cards in India are Ru-Pay cards. Financial inclusion is not just about opening bank a .....

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Most of them never get any bank credit. In other words the most employment-intensive sector of the economy gets the least credit! While Jan Dhan Yojana was to bring banking to the unbanked the second reform was to bring funding to the unfunded. We are creating a new financing and regulatory architecture under the Micro-Units Development and Refinance Agency scheme popularly known as MUDRA. Already under the Pradhan Mantri Mudra Yojana banks have provided More than six million loans to small busi .....

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lso creating an environment that fosters innovation and start-ups through the Atal Innovation Mission and the Self Employment and Talent Utilisation programme. Another financial reform is the provision of a safety net through new social security schemes. We have introduced three non-subsidised but low cost schemes covering accident insurance life insurance and pensions. Because of their massive coverage the premia are low. There are now over 120 million subscribers. For many of these reforms to .....

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more than that there have been very powerful non-financial steps. Interference in banking decisions has ended. A new process for appointments is being put in place under the Bank Boards Bureau. Credible and capable bankers have been appointed to head banks. For the first time since banks were nationalised 46 years ago private sector professionals have been appointed in key positions. This is a major reform. There is a whole eco-system focused on alleviating poverty. Perhaps this can be called t .....

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n nice fittings or attractive floor tiles or beautiful curtains is unlikely to last long. So also, empowering the poor through financial inclusion and social security will provide a more stable and lasting solution. Let me now turn to structural reforms in various sectors. Agriculture remains India s mainstay in terms of providing livelihood. We have introduced a series of reforms. There was a tendency to divert subsidised fertiliser for the production of chemicals. A simple but very effective s .....

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tly reduces wastage of inputs and increases crop yield besides protecting the soil. By reducing unnecessary chemical inputs, it is also good for health of consumers. It enables farmers to choose the best crop for their soil. Many farmers have been unaware that their land is actually more suited for a different crop. In economic terms, it is a win-win-win-win. It reduces costs, increases yields, improves the environment and protects the health of consumers. 140 million soil health cards will be i .....

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also generate a large amount of employment mainly for the unskilled the semi-skilled and the poor. This multi-pronged program is also a transformative reform. Much has been said and written about India s labour markets. We have already undertaken some important steps. Many workers in the organised sector have suffered when changing jobs by being unable to access provident fund and other benefits. The benefits accrued under one employer become difficult to account for under another employer. We .....

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ime Minister, I had received many inputs about the reforms needed in India from many economic experts. However, none of them touched on the issue of cleanliness and sanitation. Sanitation has languished for years as a poor cousin of health or of drinking water supply. It has often been viewed as a question of budgets and projects and expenditure. Yet, you will all agree that poor sanitation and lack of cleanliness is much more than an issue of health. It touches upon every aspect of our well-bei .....

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a global contraction in trade volume. The Shipping Corporation of India had been making losses continuously for several years and had a loss of ₹ 275 crores in 2013-14. In 2014-15 it earned a profit of ₹ 201 crores a turnaround of nearly ₹ 500 crores in one year. The pace of award of new highway works has increased from 5.2 km per day in 2012-13 and 8.7 km per day in 2013-14 to 23.4 km per day currently. These managerial reforms in the working of the public sector will have la .....

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so make it a source of empowerment of women who traditionally are the main owners of gold jewellery. However, this micro-economic virtue, can become a macro-economic vice. It implies a high level of gold imports. We have just launched a series of gold-related schemes. These will provide Indians with the inflation protection of gold along with a modest interest without actually holding it. If the scheme reaches its potential, it will help meet the rational expectations of the public while moderat .....

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on, the National Institution for Transforming India, or NITI. My vision of NITI is very different from the Planning Commission. It is to be a collaborative forum for ideas and action where States are full partners and where Centre and States meet in a spirit of co-operative federalism. Perhaps some people thought this was merely a slogan. But we already have concrete examples of its transformative power. Let me explain. As you all know, the 14th Finance Commission recommended that states be give .....

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NITI. And I am delighted to say, that in a fine example of co-operative federalism at its best, the Chief Ministers have unanimously agreed on a set of recommendations. This is despite the fact that this is a very complex issue, and that they come from many different political parties. I received their report, on 27th October. The main recommendation on the sharing pattern was accepted the very same day and written instructions were issued the very next day. On many other issues too, the Chief M .....

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re all probably aware, that India has substantially improved its ranking in the World Bank s Doing Business survey. But a new feature, is the very healthy and constructive competition among states. You would be surprised to know, that among the top few states are Jharkhand, Chattisgarh and Odisha. This is an example of constructive competitive federalism. In a break with over sixty-five years of tradition we have involved states even in foreign policy. The Ministry of External Affairs has been a .....

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citizens by abolishing many requirements for attestation of signatures. For example, the Department of Higher Education, has permitted self attestation by students of documents used for admission in various academic courses. We also ended the requirement to visit government offices for life certification for pensioners by introducing online biometric identification. Economists have traditionally believed that people act in their self interest. But India has a long tradition of voluntarism. We in .....

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ot rich households and belong to the lower middle class. If any of you in this room still have a subsidised connection let me appeal to you to join them. This brings me to an achievement that I think even our worst critics do not dispute. This is the change in levels of corruption. For many years, economists and other experts have held corruption to be one of the main constraints on the growth of any developing economy. We have taken decisive steps to curb corruption. I have already referred to .....

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tem of interviews for lower level posts in government. We will rely on transparent written examination results to decide who will be selected. Our campaign against tax evasion and money laundering is also well known. ₹ 6500 crores has been assessed before the new Black Money Act was implemented. Additionally, over ₹ 4000 crores has been declared under the new Act. Thus over ₹ 10,500 crores of black money from abroad has been detected and assessed. If we can sustain this improve .....

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